Retail sales moved 0.1% lower in September from August but were 3.2% higher from the same time in 2012, according to the U.S. Commerce Department.

The weakness was centered around autos, down 2.2%, the biggest decline in auto dealer sales since October 2012. Excluding autos, retail sales rose 0.4% in September. Year-over-year auto sales are up 5.1% in September.

“While it’s easy to point to the government shutdown as the catalyst to weak headline spending in September and further into the fourth quarter, it doesn't tell the whole story,” said Lindsey M. Piegza, managing director and chief economist at the investment firm Sterne Agee. “Of course the ongoing shenanigans in Washington have sown uncertainty exacerbating the consumers’ inclination to remain sidelined, but the weak trend in spending was already well established before talks in Washington began. Amid tepid job creation and minimal income growth, consumers are struggling to keep their heads above water.”

She said retailers are already initiating holiday discounts to lure in customers, but many more see the declining trend in spending and bracing for a weak holiday season, resulting in lowering sales forecasts and reducing seasonal hiring.

The report came as a new survey by The Conference Board shows consumer confidence is down this month.

Its Consumer Confidence Index, which had declined moderately in September, decreased sharply in October. It now stands at 71.2 compared 80.2 in September.

“Consumer confidence deteriorated considerably as the federal government shutdown and debt-ceiling crisis took a particularly large toll on consumers’ expectations,” said Lynn Franco, director of economic indicators at The Conference Board. “Similar declines in confidence were experienced during the payroll tax hike earlier this year, the fiscal cliff discussions in late 2012, and the government shutdown in 1995/1996. However, given the temporary nature of the current resolution, confidence is likely to remain volatile for the next several months.”

Finally a third report from the U.S. Labor Department shows prices at the wholesale level edged slightly slower in September.

The Producer Price Index fell 0.1% from the month before, following a 0.3% increase in August Excluding the volatile categories of food and energy, core wholesale prices rose 0.1%. in September.

“From the Federal Reserve’s standpoint inflation remains a non-issue continuing its slow, downward trend on an annual basis and remaining well below the Fed’s threshold of 2.5%,” said Piegza. “Remember the Fed’s primary fear of inflation stems from tightness in the labor market or a decline in the pool of available labor putting upward pressure on wages. But with a pool of labor topping 18 million and 13 million Americans actively seeking employment, resulting in less than 1% real annual wage growth, it is clear there is still ample slack in the labor market.”

She notes, more recently, Fed officials have pointed to potential bubbles particularly in the financial markets as taking precedence over a fear of inflation.